Somerfield Blues as L&R's Bid Plans Fail to Check Out

Somerfield Blues as L&R's Bid Plans Fail to Check Out

Article excerpt

SUPERMARKETS chain Somerfield was left reeling, down 8p at 182p, today after London & Regional Properties, headed by the Livingstone Brothers, abandoned plans to make a bid for the group.

L&R, which had been mooting a 205p-a-share bid, refused to disclose its reasons but it is thought United Co-operative's decision not to buy 500 unwanted Somerfield stores from L&R was the deal breaker.

A bid for Somerfield may still emerge. The last remaining team to have declared an interest, comprising Apax Partners, Barclays Capital and Robert Tchenguiz, has until 14 October to launch a bid.

The end of the week brought some relief to the FTSE 100 index.

A positive response to the Reckitt Benckiser/Boots deal and support for GlaxoSmithKline softened heavy losses sustained in the mining sector. After three days of falls, the Footsie was 10.2 points adrift at 5362.2.

Feverish excitement about the prospects of a vaccine to prevent early-stage cervical cancer injected fresh blood into Glaxo, up 18p at 1472p. Rival Merck has released data from its phase three trial showing its Gardasil vaccine was successful in preventing the development of cervical cancer associated with two types of human papillomavirus responsible for an estimated 70% of cases.

Glaxo is working on a similar vaccine, Cervarix, and intends to file for European registration in the first half of 2006.

Reckitt Benckiser received a resounding seal of approval from the City for its [pounds sterling]1.9 billion acquisition, announced today of Boots' over-the-counter pharmaceuticals business. Reckitt was 39p ahead at 1747p, making it the biggest riser in the FTSE 100. Boots, which is trying to persuade investors of the merits of a merger with Alliance UniChem, was 6p higher at 628p.

Oil majors managed to reverse the tide of heavy selling. BP, which had slipped almost 50p during the week, rose 41/2p to 625p while Royal Dutch Shell B shares were 7p stronger at 1867p and Royal Dutch Shell A put on 2p to 1784p.

The biggest drag on blue-chips came from the miners, with steep falls suffered by all the major firms. …